Q4 2023 Enanta Pharmaceuticals Inc Earnings Call
Participants
Jennifer Viera; Senior Director IR & Corporate Communications; Enanta Pharmaceuticals, Inc.
Jay Luly; President, CEO, & Director; Enanta Pharmaceuticals, Inc.
Paul Mellett; SVP, Finance & Administration & CFO; Enanta Pharmaceuticals, Inc.
Scott Rottinghaus; SVP & Chief Medical Officer; Enanta Pharmaceuticals, Inc.
Roanna Ruiz; Analyst; Leerink Partners
Jay Olson; Analyst; Oppenheimer & Co.
Ed Arce; Analyst; H.C. Wainwright & Company
Eric Joseph; Analyst; JPMorgan
Liisa Bayko; Analyst; Evercore ISI
Roy Buchanan; Analyst; JMP Securities
Presentation
Operator
Good afternoon, and welcome to Enanta Pharmaceuticals' fiscal fourth-quarter and year-end financial results conference call. (Operator Instructions) And this call will be recorded. I'll now turn the conference over to Ms. Jennifer Viera, Investor Relations. Please go ahead.
Jennifer Viera
Thank you, operator, and thanks to everyone for joining us this afternoon. The news release with our fiscal fourth quarter and year-end 2023 financial results was issued this afternoon and is available on our website.+ Making formal remarks on today's call are Dr. Jay Luly, President and Chief Executive Officer, and Paul Mellett, our Chief Financial Officer; Dr. Scott Rottinghaus, our Chief Medical Officer; and Dr. Tara Kieffer, our Senior Vice President of New Product Strategy and Development, will be available during the Q&A portion of the call.
Before we begin with our formal remarks, we want to remind you that we will be making forward-looking statements, which may include our plans and expectations with respect to our research and development pipeline and financial projections, all of which involve certain assumptions and risks beyond our control that could cause our actual developments and results to differ materially from those statements.
A description of these risks is in our most recent Form 10-K and other periodic reports filed with the SEC. Enanta does not undertake any obligation to update any forward-looking statements made during the call. With that, I'd now like to turn the call over to Dr. Jay Luly, President and CEO. Jay?
Jay Luly
Thank you, Jennifer, and good afternoon, everyone. In fiscal 2023 Enanta took important steps leading to meaningful progress in addressing the unmet need for treating serious respiratory viruses and advance in our business objectives.
As we look toward the future, we continue to assess opportunities that will leverage our expertise to transform the lives of patients by discovering novel treatments for viral infections and other diseases. 2024 is shaping up to be an important year for us with multiple inflection points expected, including potential growth into new therapeutic areas.
Today, I'll provide an overview of our progress during the fourth quarter, beginning with our respiratory syncytial virus or RSV program, and then I will comment on the rest of our pipeline and give a business update.
RSV is a severe respiratory infection associated with significant morbidity and mortality that can cause serious disease in infants, children, and other high-risk populations, including the elderly and individuals with congestive heart failure, chronic obstructive pulmonary disease or asthma.
There remains significant (technical difficulty) despite unmet need for vaccines and prophylic monoclonal antibodies that reduce the risk of infection for some high risk populations. Vaccines will inevitably have suboptimal uptake. And as we've seen with other respiratory viruses, even with adoption breakthrough, infections will still occur.
Further, while monoclonal antibodies can provide short-term passive immunity for infants, they will only shift the infant's first infection to the next season. We aim to fill this unmet need for an RSV treatment through the advancement of our broad RSV program, which includes EDP-938, the only in-protein inhibitor in clinical development and EDP-323, an L-Protein inhibitor, both of which have fast track designation from the FDA.
As such, we're evaluating EDP-938 in two Phase 2 studies, RSVPs and RSVHR as a potential treatment in high-risk patient populations. RSVP is a Phase 2 randomized double-blind, placebo-controlled study in approximately 90 hospitalized (technical difficulty) and non-hospitalized RSV aged 28 days to 36 months.
It's a two-part study because this is the first time the drug is being dosed in pediatrics. The objective of the first part of the study is to evaluate the safety and pharmacokinetics of EDP-938 in multiple ascending dose doses in order to select the optimal dose for each age group.
The objective of the second part of this study is to evaluate the antiviral activity of EDP-938 at the selected optimal dose. It was designed as a small cohort to show a trend toward improved (technical difficulty) comparative placebo, and to give confidence before we are efficiently into registrational studies.
Additionally, we will evaluate symptom scores assessed through the treatment duration. RSVHR is a Phase 2b randomized, double-blind placebo-controlled study in adults with RSV infection who are at high risk of complications, including the elderly and individuals with congestive heart failure, chronic obstructive pulmonary disease or asthma.
Approximately 180 patients will be treated with 800 milligrams of EDP-938 or placebo for five days and evaluated over a 28-day period thereafter. The primary endpoint of RSVHR is time to resolution of RSV lower respiratory tract disease symptoms as assessed by the respiratory infection intensity and impact questionnaire or RIIQ symptom scale.
Secondary endpoints include additional clinical efficacy measures and antiviral activity compared to placebo as well as pharmacokinetics and safety of EDP-938. In this study we'll be looking for an improvement in time to symptom resolution, our primary endpoint, as well as effects on other secondary endpoints, such as antiviral activity.
Both studies continue to enroll throughout the global footprint with RSVPs having over 75 sites across 15 countries and RSVHR over 130 sites across 16 countries. Our goal continues to be a completion of enrollment and at least one of these EDP-938 studies with top line data in the third quarter of 2024, assuming we return to a normal pre-pandemic type of RSVPs in the Northern Hemisphere. We are still early in that season, but initial data are consistent with a more normal season.
Also advancing our leadership in RSV, today we announced the initiation of our Phase 2a challenge study of EDP-323, an L-Protein inhibitor in development as a once daily oral treatment for RSV. In this randomized double-blind, placebo-controlled study up to 114 healthy adult subjects will be infected with the RSVA Memphis 37B virus and then randomized one to one to one to receive once daily dosing of either 600 milligrams of EDP-323, 200 milligrams of the EDP-323 with a loading dose of 600 milligrams on the first day or placebo for five days, (technical difficulty) include safety changes in viral load measurements and changes in baseline symptoms.
We plan to report data from this study in the third quarter of 2024. The advancement of EDP-323 is supported by positive Phase 1 results in which EDP-323 demonstrated favorable safety, tolerability. and pharmacokinetics in healthy volunteers.
We believe either EDP-938 or 323 would be effective as a monotherapy, but because the mechanism of action of each is different, we also have the opportunity to use them in combination. Preclinically, the combination of EDP-938 and EDP-323 has additive to synergistic activity. A combination approach would allow us to explore potentially broadening the treatment window or providing additional benefit and specific harder to treat populations.
In Hepatitis B, we believe we need an additional mechanism to develop in combination with EDP-514, our potent core inhibitor with FDA fast track designation. We think a core inhibitor such as EDP-514 could ultimately be an important component of a successful combination regimen and potentially help us address the high level of unmet need in chronic HPV.
I'd like to take a moment to acknowledge that we've made important adjustments to our business this year to significantly reduce our 2024 spending and extend our cash runway through fiscal 2027, which Paul will cover in a moment. As previously disclosed, we made the decision to stop RSVTx, our Phase 2 study in adult hematopoietic cell transplant recipients with RSV infection.
We felt it prudent to concentrate our efforts and resources on our pediatric and high-risk adult studies, which comprise the largest patient populations with unmet need and represent a faster path to market. Furthermore, we made the decision to pause our hMPV, RSV dual inhibitor program.
While the dual inhibitor has shown significant promise preclinically, we do not plan to move a third RSV compound into the clinic as long as our other two more advanced candidates continue to progress. And as we've mentioned before, we intend to conduct all future work in COVID-19 in the context of the collaboration. These changes allow us to reallocate our focus and resources to diversify our portfolio into other disease areas.
We believe this path forward best aligns with our long-term goal at Enanta to deliver highly differentiated therapeutics through innovative chemistry and positions us to (technical difficulty) shareholders. To that end, we're excited about the expansion of our research efforts into non-virology indications that leverage our core strength in small molecule drug discovery.
We look forward to providing more insight into our progress and announcing new therapeutic programs starting in early 2024. With that, I'd like to wrap up by highlighting our near-term milestones. We look forward to reporting results from our Phase 2a challenge study of EDP-323 in the third quarter of 2024.
And assuming there is a return to a normal pre-pandemic type of RSV season in the Northern Hemisphere, we expect to complete enrollment in one or both of our Phase 2 studies of EDP-938 and to have data in the third quarter of 2024. Finally, we will announce new non-virology therapeutic programs beginning in early 2024. Now, I'll turn the call over to Paul to discuss our financials. Paul?
Paul Mellett
Thank you, Jay. I'd like to remind everyone that Enanta reports on a September 30 fiscal year schedule. Today, we're reporting results for our fourth quarter and full year ended September 30, 2023. For the quarter, total revenue was $18.9 million and consisted of royalty revenue earned on AbbVie's MAVYRET/MAVIRET net product sales. This compares to total revenue of $20.3 million for the same period in 2022.
For the 12 months ended September 30, 2023, total revenue was $79.2 million compared to $86.2 million for the same period in 2022. The decrease in the quarter and year-over-year revenue is due to decline in any of these sales of MAVYRET/MAVIRET beginning in the quarter ended September 30, 2023. 54.5% of the Enanta's ongoing royalties from AbbVie's net sales of MAVYRET/MAVIRET that are included in our revenue by being paid to OMERS, one of Canada's largest design benefit pension plans pursuant to a royalty sale transaction in April 2023.
For financial reporting purposes the transaction was treated as debt with the upfront purchase payment to us of [$200 million] recorded as a liability. Enanta will continue to record 100% of the royalties earned as revenue and willing to amortize the debt liability proportionately and to payments updated to OMERS [until 0.42 times] of the purchase payment is met, after which 0.100% for the cash royalty payments will be retained by Enanta.
Non-cash interest expense with debt will be recorded in Enanta's consolidated statement of operations as a non-operating expense based on an imputed interest rate. Interest expense was $3.2 million for the three months ended September 30, 2023, and $5.1 million for the 12 months ended September 30, 2023.
Moving now to our operating expenses. For the three months ended September 30, 2023, research and development expenses totaled $36.2 million compared to $34.8 million for the same period in 2022. The slight increase was due to an increase in the timing of clinical trial costs, offset by a decrease in preclinical and manufacturing costs.
For the 12 months ended September 30, 2023, research and development expenses were $163.5 million compared to $164.5 million in 2022. General and administrative expenses totaled $13.8 million for the three months ended September 30, 2023, compared to $12.6 million for the three months ended September 30, 2022.
For the 12 months ended September 30, 2023, general and administrative expenses totaled $52.9 million compared to $45.5 million in 2022. The increases in both periods were primarily due to an increase in legal fees related to a patent infringement suit against Pfizer.
Other income net, total $4.7 million for the three months ended September 30, 2023, compared to $0.7 million for the three months ended September 30, 2022. The 12 months ended September 30, 2023, other income net totaled $11.4 million compared to $1.7 million in 2022. The increases in both periods were primarily due to an increase in investment income due to an increase in our average invested cash balance from the receipt in April '23 of $200 million from the sale of our MAVYRET/MAVIRET loyalty as well as increases in interest rates year over year.
Enanta recorded an income tax benefit of $1.4 million from the three months ended September 30, 2023, compared to an income tax expense of less than $0.1 million from three months ended September 30, 2022. Enanta recorded an income tax expense of $2.8 million for the 12 months ended September 30, 2023, compared to an income tax benefit (technical difficulty) 2022.
The recording of financial reporting loss before taxes during the 12 months ended September 30, 2023, we recorded tax expense driven by the receipt of the $200 million from the royalty sale agreement, which is treated as income for federal and state income tax purposes. This taxable income in this related income tax expense was substantially offset by net operating loss carry forwards, research and development tax credit carry forwards, and a deduction for foreign-derived intangible income.
Net loss from the three months ended September 30, 2023, was $28.1 million or a loss of $1.33 per diluted common share compared to a net loss of $26.3 million or a loss of $1.27 per diluted common share for the corresponding period in 2022.
For the 12 months ended September 30, 2023, net loss was $133.8 million or a loss of $6.38 per diluted common share compared to a net loss of $121.8 million, or a loss of $5.91 per diluted common share for the corresponding period in 2022.
Enanta ended the quarter with approximately $370 million in cash and marketable securities. We expect that our current cash, cash equivalents, and short-term marketable securities, as well as our ongoing routine portion of royalties, will continue to be sufficient to meet the anticipated cash requirements of our existing business and development programs through fiscal 2027.
Regarding guidance for fiscal '24, we expect our research and development expense to be between $100 million in the $120 million, and our general and administrative expense to be between $45 million and $50 million. This is reduced from research and development expense of $163.5 million and general and administrative expenses of $52.9 million in fiscal 2023.
This general and administrative expense includes an increase in legal fees associated with our patent infringement suit against size. Pfizer. Further financial details are included in our press release and will be available in our annual report on Form 10-K when filed. I'd now like to turn the call back to the operator and open up the lines for questions. Operator?
Question and Answer Session
Operator
(Operator Instructions) Roanna Ruiz, Leerink Partners.
Roanna Ruiz
Hi afternoon, everyone. So I wanted to ask about one of your RSV programs, first 323 with the challenge study. I was curious, assuming that successful, how fast could you proceed to Phase three? And what sort of measures are you considering for Phase 3 design like symptoms or virology endpoints?
Jay Luly
Hi, Roanna. This is Jay. So we're aiming, as we said on the call to finish up the challenge study and report our data in Q3. There's obviously some other things we would need to do in terms of preparedness for, well beyond the challenge study, let's just say that. And I think what we're going to do is simultaneously be watching in the 938 studies and learning ultimately from hopefully at least one of those data and feeds or HR to help inform the development path of how we're thinking about 323 going forward. So it's a little bit premature. I want to also take a peek at the data from the challenge study.
Again, it's a very, very potent molecules, it's got a great PK. We've set up a couple of different dosing regimens, both of which are effectively QD -- one is the high dose QD and then the other is a loading dose on day one QD followed by a lower dose on these two through five. So we'll get the aggregate of the data, look at it, see how it compares to 938 and the challenge study, at least as best we can compare to challenge studies.
And then we're thinking a lot about how we position either of these in the market. We think that either of them could be used as a single agent, but also since they have different mechanisms to potentially be used in combination, there's no cross resistance. And I think we would have good barrier to resistance under dosing them. So lots of different options, but a little bit premature to talk about 323 too far down the line.
Roanna Ruiz
Yeah, understood. And my second question, I just wanted to ask about the dual inhibitor program for human metapneumovirus and RSV. I was curious as the positive development there, is it more just to prioritize your other more later stage RSV trials? Or was there any new data that informed this decision?
Jay Luly
No, the data continued to look really interesting in terms of the profile. As we think about it, again, we've got a fair number of things on our plate right now, but we've got two more advanced RSV molecules moving ahead, well in development. And the dual when you distil it down, it has human metapneumo, which we do think is an advantage.
Human metapneumo is a fraction of the market of RSV. It's not an insignificant fraction, but it's still a fraction. I think RSV -- having RSV in that dual is very, very important because RSV is a big piece of what that market would look like anyway. And when we step back and looked at our current ongoing studies and the resources and involved, we have two that are moving along very nicely for the large piece of the overall market, which is obviously RSV.
So I think we still have some light activities, you know, sort of smouldering on that. But I think the key focus is going to be watching that our two lead horses, watching that clinical data come out. And then we've always got that molecule in our back pocket in reserve.
Roanna Ruiz
Got it. Thanks.
Jay Luly
You're welcome.
Operator
Jay Olson, Oppenheimer.
Jay Olson
Hey, thanks for taking the question and recognizing it's early. Maybe just to follow up on 323. I guess what are you hoping to see in the Phase 2a challenge study? What extent of viral load reduction would be clinically meaningful? And how do you plan to differentiate 323 from 938? Thank you.
Jay Luly
Thanks, Jay. This is Jay. I always look forward to saying that once a quarter. So I think, the challenge study is nice because it's been it's been run against different classes of compounds that's been done substantially. We've got already very strong data set with 398 that serves as a certain standard internally, any way to compare data to.
So the type of data that you would get from that is you look at both virology and symptoms. So you look at and it's really compared against placebo, right? So everyone is infected inoculation day, so to speak. You wait for the viral loads to begin to build. And that happens variously on a different day for one person versus another.
But once you start to register viral loads, the next day you begin dosing, right. And so what we found, at least with 939 was almost immediately upon dosing, you change the trajectory of the infections. So people who were dosed with placebo, viral loads continued to rise, they peak and then they gradually decline over a period of many days. People who were dosed with our test agent, you see viral load is basically stopped in their tracks and in fact are pushed downward rapidly.
So what that allows you to do is compare the area under the curve of drug treatment versus placebo. And we've put very strong numbers on the boards with EDP-938, I think in the 70%-ish reduction in the AUC. Simultaneously, you're tracking symptom scores and you're looking at a composite of multiple different symptoms and had some -- they are pretty much the same graph.
Placebos track upwards, ultimately plateau and then have a slow decline and drug treatment process that curve down pretty rapidly and pretty completely. So again, it allows you to compare the AUC of drug treatment, the numerator versus AUC of placebo in the denominator. And once again, at least with 938, we had very strong numbers on the board in terms of percent inhibition. So that's the type of data that will be going for with 323.
Again, we need to run this study, it's very, very strong and have a very potent inhibitor. And I would say we've even got more from an exposure standpoint, everything else, even greater pressure on the virus with 323 exposures even over 938, which were good. So again, we'll look at the data. It may not be possible to differentiate at that stage. But that does differentiate. And somehow we certainly believe that 938 has sufficient horsepower to go the distance in most patients as a single agent.
Obviously, we need to prove that with the Phase 2s. But to the extent we wanted to segment and maybe use a combo in a different patient population or relegate one of the drugs in a slightly different way than the other, again, having both of these mechanisms that are disposal will allow us to think of all kinds of things.
Jay Olson
Great. Thank you, Jay, for the comprehensive explanation. And if I could ask just one follow on. You have various non-virology programs at early stages, discovery stage of development. Can you just talk about what disease you are interested in for those non-virology programs? Thank you.
Jay Luly
Yeah, not today, as I indicated, we'll begin to talk about that early next year.
Jay Olson
Okay, great. Look forward to that. Thanks again for taking the questions.
Jay Luly
Thank you.
Operator
Ed Arce, H.C. Wainwright & Company.
Ed Arce
Hi, Jay and Paul, thanks for taking our questions. Appreciate it. And congratulations on the initiation of the Phase 2a challenge study for 323. I also have a question of in that regard, kind of drill down a little bit further from the previous question with regards improvements measured as AUC with both virology and symptoms versus placebo. You mentioned in virology previews asset -- 938 had shown about 70% reductions in AUC.
And so what I wanted to ask is what level you believe is both competitive and clinically meaningful? Or, perhaps put another way, what specific level or degree of reduction defines a success for the study sufficient to proceed to further development? And then I have a follow-up.
Jay Luly
Sure. Well, I think no one really knows yet and hopefully we will be the first to show is the what level you really need to drive efficacy in the real world infection. We've looked at all the challenge study models that have been done and EDP-938 is basically as good as it gets in terms of driving those kinds of numbers in the challenge models.
So we're hopeful that those are at least adequate numbers to do that translation and the real world. In terms of what we're aiming for, I mean, obviously 938 is some sort of the standard. I'd aim to be in the ballpark of 938 efficacy, which again, you can't translate as a preclinically and clinically perfectly. But I think we used the same sort of criteria metrics thresholds to pass preclinically for 323 as we did for 938. So we'll see how that translates. But 938 like efficacy and the challenge is very strong. And I'm hoping we can do about that well with 323, the high bar.
Ed Arce
Right. Great. And then staying with 323, I wanted to ask also given that you're testing two different doses, one with a loading dose in the first day and another one which is uniform throughout the treatments. If both of those show -- what would be the rationale to continue to study both doses, especially given the differential populations that might ultimately be treated with 323?
Jay Luly
Yeah, it's a good question. And I think probably the short answer is we're hoping that we will define a dose from the challenge study and then move one forward. Obviously, 600 QD for five days has more horsepower may be more than we need, right. And so infectious disease often we'll use a loading dose -- to help you get to steady-state quicker and then steady-state PK.
And then -- so what we're asking really is can that lower dose on the tail end of the -- one at the tail end after the high loading dose and the maintenance dose, lower maintenance dose. Is that enough just as good horsepower? Obviously, from a cost of goods perspective, they are very different. So that's worth exploring. We'll get an answer studies and hopefully, we'll get a clear answer future.
Ed Arce
Okay. And actually one last one, if I may also on, as has been asked before and on the non-virology indications. I recognize that you're not prepared at this moment to discuss specifics, but just in terms of timing, early 2024, with that necessarily around JPM and also given your expertise with these new candidates necessarily be small molecule assets. Thanks so much.
Jay Luly
Well, you're correct. Our historic skillset has been in small molecule drug discovery and development, that is still predominantly our main focus. And with regards to timing, it'll be early next year.
Ed Arce
Great. Thanks so much.
Jay Luly
You're welcome.
Operator
Eric Joseph, JPMorgan.
Eric Joseph
Hi, good evening, thanks for taking the question. For the Phase 2 RSV high-risk study with EDP-938, I'm not sure if it's been clarified previously, but can you just remind us whether that study is open to patients who have been immunized with either of the commercial RSV vaccines? Do you expect prior immunization to comprise a meaningful proportion of that study's enrollment? And I'm just kind of maybe just looking longer-term, I'm curious to get your thoughts on whether sort of how prior RSV vaccination should be treated in a Phase 3 study design. I guess how important is the kind of looking activity on that background for the purposes of the registrational trial? Thank you.
Jay Luly
I'll answer part of the question and then hand it over to Scott Rottinghaus, our Chief Medical Officer. With regards to current state of immunization, 5% of the adult population has been immunized. And so it's not a significant factor in the current backdrop on RSV recruitment today. I'll let Scott talk about inclusion, et cetera.
Scott Rottinghaus
Thanks, Jay. Hi, this is Scott Rottinghaus. We're not currently studying vaccinated patients in our Phase 2 study. Obviously, we will have to see how things are going for Phase 3 when we design that study going forward.
Eric Joseph
Okay. And maybe just to follow up on your runway guidance into 2027. Can you talk a little bit about sort of what that anticipates in terms of additional 938 or 323 development, assuming the data in third quarter supportive?
Jay Luly
Yeah. So well, it's advancing on really both of those agents, a pace of advancing into registration studies for each. So no, we're just pushing them ahead. In terms of the reductions came from at least focusing down on some of the current active, obviously not taking a third RSV molecule into the clinic has an impact, even though as I detailed a little bit we're maybe leaving a little bit of an hMPV opportunity on the table for now.
The big driver was obviously not doing COVID outside of the partnership, I mean, COVID was a big thing, not only with regards to development, but also some of the other discovery activities we had ongoing. And then the third one was focusing 938 development on the two largest patient populations, pediatrics being number one and adult high risk being number two.
It's not to say that again, an agent once it's far along and hopefully treating, you know, those broader label currently and ultimately include transplant, but just in terms of a bandwidth, that's helpful. And from a pocket book perspective, it's also helpful.
Operator
Brian Skorney, Baird.
Hey, guys, thanks for taking the question. This is Luke on for Brian and for nine three eight. We were wondering, is it more likely that we see data from a pediatric or high risk study first? And then do you have any specific goals in mind for the efficacy or biomarker endpoints that would give you particular degree of competence as you think about planning a pivotal program? Thanks.
Jay Luly
So it's we can't make the call at this point in terms of which trial to come before the other, again, they're recruiting two very different patient populations with different studies, the interesting aspects regarding recruitment. So they're not a similar studies from a patient population perspective at all, um, I think an and each of those studies were looking for virology, especially in the PEA study.
We're looking for virologic trends that push us, you know, toward registration, these will be the different virologic sort of measures that we've outlined and generally seen something good and virology is probably a very important. It's a smaller study. As we've indicated, symptoms getting enough symptom data is going to be well, you'll collect the symptom data yet. And then we'll tried to figure out, which are the most impactful sometimes and look at that sort of data. But it's a very small study to be harvesting.
A lot of symptom data that you can that you can use productively on the secondary endpoint will take anything we can get there. And I think also in the high risk patient population on, we're looking at time to resolution of symptoms and it's a symptomatic endpoint. Again, readout. There is what we would be a gaming aiming to do as well. And so the key is the challenge is not to be confused with the challenge study with the challenges constructing these studies in such a way that their decision enabling to move forward to registration studies, but not sizing them to be at registration studies and another themselves.
So I think that's the balance that we've tried to strike with each of these. So some are hoping for a good northern hemisphere season to the extent that seasonality can be viewed as being somewhat normal. It. It seems to be coming around at a historically more normal time.
Recall that the pandemic first, you know, moved RSV out of the equation as well as you're starting to see headlines now about flu starting to come back. And we know that our SVM.s coming back and that's started to we started to see it again historically is sort of picks up in late October. And then begins its ascent there. So I'm not so far it looks like it's the season is on track and we'll just continue to monitor and recruited away, though.
Great. Thank you, Jay.
Operator
Liisa Bayko, Evercore.
Liisa Bayko
I think most my questions have been answered, but I guess would you preclude absent entering into the GLP-1 space there that might that be an interesting one area for you to contemplate developing a content? Thanks.
Jay Luly
Yes, we're not really discussing are new areas today. I'm sorry, Liisa, Happy Thanksgiving.
Liisa Bayko
Thank you.
Operator
Roy Buchanan, JMP.
Roy Buchanan
Thanks for taking the question. Can you just kind of break down how many patients do you expect in the MAD portion versus that gets dose expansion portion? And then I think you were planning to have discussions with the FDA for two three, five around potential endpoints. And can you just update us on any of that discussion based feedback from the FDA thinks best of the Peet's study?
Jay Luly
It's broken out into a bunch of different parts, um, you know, because you have a dose escalation going on in multiple different levels, age groups, subsets and then some and then ultimately, we do the dose range in there and then move over into the other side. I think the dose-ranging part is slightly bigger than the other part, but there are roughly the balance and then two, three, five times, you know, I think they say it's a situation where the world is still settling down with COVID.
I think what we're what we're seeing is I will let the world seems not a lot of hospitalization and death. That is mercifully changed a little bit. I think that's in part due to two factors. The viruses change and the host has changed on people that obviously become more immune experienced either through natural infection or through multiple vaccinations or both. And then the virus has sort of twists and turns into one form of Omicron or another.
And now the result of that, as you see much less hospitalization and death impact, I think clearly at a high risk of study running in Phase 3, and they recently I'll start that study due to the challenges in recruiting so far, I think it's fair to say, you know, Summing everything up, looking at the, you know, the background of the patient population as well as thinking about how you register drug. The most expedient straightforward path is probably in standard risk patients. And then I'm trying to build on that as you as you go and ultimately get more types of patients into studies. But I think focusing on high risk itself right now is a more challenging proposition.
Operator
One moment, please. I'm showing no further questions at this time. I'll turn the call back over to Jennifer Viera for any closing remarks.
Jennifer Viera
Thank you, operator, and thanks, everyone, for joining us today. If you have additional questions, feel free to contact us by email or call on the office. Thanks and have a great night.
Operator
Thank you. Ladies and gentlemen, this does conclude today's conference. You may now disconnect. Have a great day. Thanks.
